A Football League SWOT Analysis: The Weaknesses

Of course by its very definition the Football League is weak – comparatively. While it’s true that West Ham and Southampton skilfully negotiated the step up to the Premier League this past year, both enjoyed wage structures and transfer budgets way beyond the scope of second tier clubs.

Yesterday’s opening post on this four day SWOT analysis salvo perhaps painted too rosy a picture of the League’s attributes. Today’s comes up with a decidedly different portrait. It’s clear that many of the competition’s strengths have their exact obverse on the weaknesses front and indeed, many of these issues are perilously close to the threats category. We shall return to that on Friday but here, we inevitably have to start with matters financial.

Club Finances

Within a few days of losing their Football League status in April, Aldershot Football Club announced that they would be entering administration. Any hope, however, on the League’s part that this would mean one less financial basket case were dashed when Queen’s Park Rangers lined up to replace the Hampshire club.

Rangers’ travails dwarf those of the Shots and bear comparison with those of their Scottish namesakes. As we explored in these pages in May, Harry Redknapp’s desperate attempt to keep QPR in the Premier League proved to be £21.5 million wasted while that most telling of statistics, the wages to turnover ratio, stands at a cage rattling 183%.

QPR have debts of over £100 million and while the sugar daddy model is cited to defend this level of irresponsibility, Tony Fernandes surely wasn’t born yesterday, as evidenced by the highly significant £15 million loan the club were forced to take out in February.

For while revenues can be high given that the Championship in particular is the fourth most watched League in Europe , the tendency of clubs to commit those riches in player wages and other excesses leads to a very different situation as far as profitability is concerned.

Indeed, it’s not just the newcomers sated on the golden tit of the EPL that are in a parlous state. Take Coventry City whose 2012-13 saw them subject to a 10 point deduction, a transfer embargo, the closure of the club shop, placement into administration by their dark overlords Sisu Capital and linked variously with stadium moves to Hinckley, Northampton and Walsall.

Take also Bury, in all probability saved on May 24, but reliant on loans from the Professional Footballers Association and with a mere eight players remaining on the wage bill. Take also Blackburn Rovers, with a £40 million loss predicted, exacerbated by compensation pay offs to sacked managers Henning Berg (£2.5 million) and Michael Appleton (a fifth of that and yet still a sizeable sum).

Meanwhile, Oldham Athletic appear to be lining up to confirm Stephen Vaughan as their new owner – formerly of the now defunct Chester City, Vaughan was the first person to fail the League’s fit and proper persons test. A year from now, a similar article to this will likely list a different set of clubs.

Governance

Failing the fit and proper persons test takes some doing given the administrators’ laissez-faire approach to dodginess on all levels – but what can one expect from an organisation that called on the pro-market, anti-regulation Brian Mawhinney to be its Chairman a decade ago now?

Up and down the divisions, there are examples of poor governance and a lack of accountability – from the sums Peter Pannu is receiving in his role as acting Chairman of Birmingham City to the ongoing car crash that is Blackburn Rovers, to a Swindon Town forking out £250,000 a month in wages and sitting £13 million in the red as of January.

Greg Clarke, the League’s head honcho, recently saw off a potential vote of no-confidence at a meeting in Portugal (why Portugal?) – and this followed the collapse of a £21 million sponsorship deal with B&Q and a brazen attempt to desert the job in a bid to become Football Association Chairman. Despite encouraging noises on the subject of safe standing and other issues, it’s on Clarke’s watch that all the financial problems have become heightened – and I haven’t even mentioned Portsmouth.

Dependency on the Premier League

Clarke’s main failure has been to over rely on the Premier League. Like Muttley, he and his cohorts can be heard cackling by turns cunningly and nervously with every new measure Richard Scudamore and his chums impose.

Take the almost illogical phenomenon that is the parachute payment – wildly distorting and a reward for failure. Relegated clubs now stand to collect £60 million over four seasons and the result can only be a provocation to take a risk and spend more.

Newcastle and West Ham chanced it and it paid off and QPR will without question try to do the same, jarring the competitive environment that we cited as one of the League’s strengths yesterday – but the list of those who saw the payments as a boon only to crash and burn is longer – Wolverhampton Wanderers, far from the worse run club financially, are the latest to feel the full effect of these pernicious instruments.

So-called solidarity payments to other clubs are thus dwarfed at £2 million a shot while the Elite Player Performance Plan, millions from Sky and the current sponsorship deal further induce over reliance on the Premier League Death Star. As EPL teams pick up talented youngsters on the cheap, it will become clear that none of it is for free and, as I mentioned earlier, one only has to look back to the ITV Digital fiasco to see how these weaknesses can soon become threats.

Identity

Although far less of a problem than the general financial and governmental malaise, another weakness that the League could be accused of is a certain lack of identity.

For sure, there is character in spades if you choose to look for it but anyone who has seen the puzzled look of a dog being shown a card trick etched across a friend’s face when you reveal to them your support for a Football League club will understand the sense of embarrassment and squirming lack of connectedness that nailing one’s colours to the lower league mast can bring.

Nor can the identikit, out of town stadia – which I praised for their advantages yesterday – seem characterful enough. Between the glitz of the Premier League and the true grassroots of non-league, the Football League can appear as an unnecessary halfway house – neither exciting enough to capture the zeitgeist nor real enough to seem genuine.

It’s probably this drawback that has led the power that be to tinker with the branding – hence, the still objectionable moniker of ‘The Championship’ and the ever shifting sands of the bottom two divisions’ labelling. In short, this wrongheaded attempt to define a brand has ended up doing nothing of the sort – the next time I hear Chelsea Dagger when a team scores, I’ll be running to the hills while a single Frankie and Benny’s pizza is one too many.

Tomorrow, we’ll move on to survey some possible opportunities to address these weaknesses.

Rob Langham (pen name: Lanterne Rouge) is co-founder of the defiantly non-partisan football league blog, The Two Unfortunates, a website that occasionally strays into covering issues of wider importance. He's 47 and lives in Oxford while retaining his boyhood support of Reading FC. He tweets as @twounfortunates and has written for a number of websites and publications including The Football Attic, The Inside Left, When Saturday Comes, In Bed with Maradona, Futbolgrad and The Blizzard as well as being nominated for the Football Supporters' Federation Blogger of the Year Award in 2013.

2 Comments

Stanley

There are one or two points in his defence: the eagerness of most Championship clubs to appease the Premier League – and the unstated, but omnipresent threat of a breakaway by the larger clubs – is difficult to confront. These clubs have very little interest in angering the Premier League hierarchy when they hope to join it and are the main beneficiaries of its parachute payments. The weakness of the Football League can, thus, be attributed in part to the overall structural imbalance of English football as a whole. It would be a fair argument that the chairman alone cannot put this right. Also, I still hold out some hope that the wage-caps agreed for Leagues 1 and 2 will eventually bring lower league houses into order.

The negatives far outweigh the positives, though. The EPPP debacle, the expansion of parachute payments, the mounting financial crises at many member clubs, reduced TV revenues, the collapsed sponsorship deal… The list of failures indicates a chairman out of his depth.

Fans are rightly paying closer attention to the governance of individual clubs. But the light must also be directed towards the League itself. The recent news that a permanent CEO will be appointed is welcome only if it heralds a change in strategy. Continuity with a new face is not good enough. Clear leadership is required: on ownership rules, on financial prudence, on tempering the influence of Championship clubs, on countering the Premier League’s ever-more-brazen threats… It’s clear that Clarke hasn’t provided this. The new CEO must do so.

I think you highlight a real problem for the Football League in that big, powerful clubs are sat there waiting either to get out or to breakaway. If the opportunity is offered to create a second Premier League including the top few Football League clubs, those two Scottish clubs and maybe even an Irish side, they’ll grab it without a second thought for the rest of the Football league. The creation of the Premier League set English football on a path and getting off it will take a major and united stand from fans – but even fans (as a mass entity) don’t really care about anything other than getting to the top table either. it’s all very sad.